Speculation mounts over Aegon sell-off plan

Published on Sunday 20 June 2010 21:35

SPECULATION is mounting that Aegon is readying its Edinburgh-based UK life and pensions business for a sale later this year as Alex Wynaendts, chief executive of the Dutch insurer, prepares to deliver a strategy update to the City tomorrow.

Wynaendts will make a presentation on global strategy at an analyst and investor meeting in London. This is also expected to include an update on the future of Aegon's UK life and pensions business, which has been earmarked by some industry sources for a possible sale.

One report at the weekend suggested that Aegon's in-house advisers were "tidying up" the Edinburgh operation – which has around two million customers and is responsible for more than 4,900 staff – so it can be marketed to potential buyers later this year. A price of 1.5 billion was mooted.

A spokeswoman for Aegon UK, which was formed when the Dutch insurer bought Scottish Equitable in 1994, would not comment on a potential sale but confirmed Wynaendt's visit to London tomorrow.

She said: "Alex Wynaendts will give an update on global strategy, which is expected to include an update on the UK."

Aegon has long been cited as one of the potential targets for Clive Cowdery's Resolution acquisitions vehicle, but the insurer has consistently denied any discussions. Earlier this month, it was revealed that Resolution had made a 2.8bn bid for Axa UK.

However, market observers have raised questions about Aegon's long-term strategy and whether Wynaendts would choose to sell off the British operation, which saw a 7 per cent decline in new business in the first quarter of this year.

In February, Aegon's UK boss Otto Thoresen set industry tongues wagging when he unveiled a surprise shake-up at its base at Edinburgh Park, which saw life and pensions boss Feilim Mackle and the director of marketing Steve Clode depart.

The insurer had considered their appointments a coup when Mackle was brought over from Royal Bank of Scotland and Clode was poached from Nationwide Building Society in September 2007.

Clode was the mastermind behind the firm's 30 million sponsorship of British tennis, including the Aegon Championships at the Queen's Club.

As part of the reshuffle, Adrian Grace and Iain Black were installed as chief operating officers. The new structure was unveiled with the group's latest results, which showed that its life and pensions business fell 23 per cent to 943m.

The group also booked 183m in impairment charges due to its "significant investments" in corporate bonds.